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News Release
FOR IMMEDIATE RELEASE
EUB Decision Protects Bitumen for Future Generations of Albertans
Energy Content of Conserved Bitumen about 500 times Larger than Energy Content of Shut-in Gas
Calgary, Alberta (June 8, 2004) The Alberta Energy and Utilities Board (EUB) has issued Decision 2004-045, Order 04-001, and Order 04-002, which address the risk that natural gas production poses to the ultimate recovery of bitumen from the geological strata known as the Wabiskaw-McMurray in the Athabasca Oil Sands Area.
"These are the latest steps in a fair and balanced process to protect the bitumen for current and future generations of Albertans," said EUB Chairman Neil McCrank. "The Decision and Orders balance the interests competing for these resources and also clearly reflect the EUB's mandate of conserving Alberta's energy resources."
The EUB believes there is an immediate and continued risk to bitumen recovery from the production of some natural gas in the Wabiskaw-McMurray. The Wabiskaw-McMurray contains gas that is in contact with some of the highest quality bitumen resources in the province. As this gas is extracted, there is a drop in pressure within the gas pools. The EUB has found that gas production in these circumstances poses an unacceptable risk to bitumen recovery using thermal techniques, such as steam-assisted gravity drainage (SAGD).
The Decision and Orders result in:
- The shut-in of Wabiskaw-McMurray natural gas totalling about 280 billion cubic feet (about 0.7 per cent) of Alberta's remaining natural gas reserves, or about 45 billion cubic feet (about 0.9 per cent) of Alberta's annual natural gas production (2003 figures).
- The conservation of about 25.5 billion barrels of potentially recoverable Wabiskaw-McMurray bitumen that is in contact with the shut-in gas. The bitumen conserved is about 14.6 per cent of Alberta's remaining bitumen reserves.
The energy content of the bitumen reserves at risk, and conserved through the Decision and Orders, is about 500 times larger than the energy content of the shut-in natural gas production.
Decision 2004-045 and Order 04-001 result from a public hearing held in Calgary from March 10 to April 1, 2004. The focus of the hearing was Wabiskaw-McMurray gas production that an EUB Staff Submission Group recommended either be shut-in or allowed to produce. Gas and bitumen producers that disagreed with specific Staff Submission Group recommendations presented their case during the hearing.
Order 04-002 rules on other Wabiskaw-McMurray gas production that was also the subject of recommendations from the EUB Staff Submission Group. These specific recommendations were not challenged during the hearing, and not addressed in Decision 2004-045.
On July 22, 2003, the EUB issued Bitumen Conservation Guidelines that ordered the interim shut-in of Wabiskaw-McMurray gas totalling about 2 per cent of Alberta's remaining gas reserves and about 2 per cent of Alberta's total annual gas production. The EUB then moved forward with a phased process to more accurately identify gas that is in contact with bitumen in the Wabiskaw-McMurray. The release of Decision 2004-045, and Orders 04-001 and 04-002 are the latest steps in that process.
The EUB will hold a pre-hearing meeting on September 15, 2004 to determine the scope and participants of a final public hearing on this matter.
The EUB ensures that the discovery, development, and delivery of Alberta's resources and utilities services take place in a manner that is fair, responsible, and in the public interest.
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Note to Editors: Attachments include:
For more information, please contact:
Tom Neufeld
EUB Communications
Tel. 403.297.8565
Fax. 403.297.3757
Email: tom.neufeld@gov.ab.ca
NR 2004-21
